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A Theory of North-South Trade and Globalization

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Author Info
Paul Segerstrom
Elias Dinopoulos

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Abstract

This paper develops a dynamic general equilibrium model of North-South trade. Northern firms devote resources to innovative R&D to discover higher quality products and Southern firms devote resources to imitative R&D to copy state-of-the-art quality products. Both innovation and imitation rates are endogenously determined as well as the degree of wage inequality between Northern and Southern workers. The steady-state effects of globalization and stronger protection of intellectual property are analyzed

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Paper provided by Society for Economic Dynamics in its series 2004 Meeting Papers with number 30.

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Date of creation: 2004
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Handle: RePEc:red:sed004:30

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Related research
Keywords: Economic Growth; North-South Trade; Globalization;

Other versions of this item:

Find related papers by JEL classification:
F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
O34 - Economic Development, Technological Change, and Growth - - Technological Change - - - Intellectual Property Rights

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Samuel S. Kortum, 1997. "Research, Patenting, and Technological Change," Econometrica, Econometric Society, vol. 65(6), pages 1389-1420, November.
  2. Mansfield, Edwin & Schwartz, Mark & Wagner, Samuel, 1981. "Imitation Costs and Patents: An Empirical Study," Economic Journal, Royal Economic Society, vol. 91(364), pages 907-18, December. [Downloadable!] (restricted)
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    Other versions:
  4. Pritchett, Lant, 1997. "Divergence, Big Time," Journal of Economic Perspectives, American Economic Association, vol. 11(3), pages 3-17, Summer. [Downloadable!] (restricted)
    Other versions:
  5. Grossman, Gene M & Helpman, Elhanan, 1991. "Endogenous Product Cycles," Economic Journal, Royal Economic Society, vol. 101(408), pages 1214-29, September. [Downloadable!] (restricted)
    Other versions:
  6. Segerstrom, Paul S & Anant, T C A & Dinopoulos, Elias, 1990. "A Schumpeterian Model of the Product Life Cycle," American Economic Review, American Economic Association, vol. 80(5), pages 1077-91, December. [Downloadable!] (restricted)
  7. Jones, Charles I, 1997. "On the Evolution of the World Income Distribution," Journal of Economic Perspectives, American Economic Association, vol. 11(3), pages 19-36, Summer. [Downloadable!] (restricted)
    Other versions:
  8. Jones, Charles I, 1995. "Time Series Tests of Endogenous Growth Models," The Quarterly Journal of Economics, MIT Press, vol. 110(2), pages 495-525, May. [Downloadable!] (restricted)
  9. Elias Dinopoulos & Paul Segerstrom, 1999. "A Schumpeterian Model of Protection and Relative Wages," American Economic Review, American Economic Association, vol. 89(3), pages 450-472, June. [Downloadable!] (restricted)
  10. Peter Howitt, 1999. "Steady Endogenous Growth with Population and R & D Inputs Growing," Journal of Political Economy, University of Chicago Press, vol. 107(4), pages 715-730, August. [Downloadable!] (restricted)
  11. Gancia, Gino, 2003. "Globalization, Divergence and Stagnation," Seminar Papers 720, Stockholm University, Institute for International Economic Studies. [Downloadable!]
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  12. Segerstrom, Paul S, 1998. "Endogenous Growth without Scale Effects," American Economic Review, American Economic Association, vol. 88(5), pages 1290-1310, December. [Downloadable!] (restricted)
  13. Jeffrey D. Sachs & Andrew Warner, 1995. "Economic Reform and the Process of Global Integration," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1995-1), pages 1-118. [Downloadable!]
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  15. Horowitz, Andrew W & Lai, Edwin L-C, 1996. "Patent Length and the Rate of Innovation," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 37(4), pages 785-801, November.
  16. Dinopoulos, Elias & Thompson, Peter, 1998. " Schumpeterian Growth without Scale Effects," Journal of Economic Growth, Springer, vol. 3(4), pages 313-35, December. [Downloadable!] (restricted)
  17. Yang, Guifang & Maskus, Keith E., 2001. "Intellectual property rights, licensing, and innovation in an endogenous product-cycle model," Journal of International Economics, Elsevier, vol. 53(1), pages 169-187, February. [Downloadable!] (restricted)
  18. Grossman, Gene M & Helpman, Elhanan, 1991. "Quality Ladders and Product Cycles," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 557-86, May. [Downloadable!] (restricted)
    Other versions:
  19. Elias Dinopoulos & Peter Thompson, 1999. "Scale effects in Schumpeterian models of economic growth," Journal of Evolutionary Economics, Springer, vol. 9(2), pages 157-185. [Downloadable!] (restricted)
  20. Helpman, Elhanan, 1993. "Innovation, Imitation, and Intellectual Property Rights," Econometrica, Econometric Society, vol. 61(6), pages 1247-80, November. [Downloadable!] (restricted)
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  21. Barro, Robert J & Sala-i-Martin, Xavier, 1992. "Convergence," Journal of Political Economy, University of Chicago Press, vol. 100(2), pages 223-51, April. [Downloadable!] (restricted)
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  22. Segerstrom, Paul S., 1999. "Intel Economics," Working Paper Series 524, Research Institute of Industrial Economics.
    Other versions:
  23. Glass, Amy Jocelyn & Saggi, Kamal, 2002. "Intellectual property rights and foreign direct investment," Journal of International Economics, Elsevier, vol. 56(2), pages 387-410, March. [Downloadable!] (restricted)
  24. Jeffrey Sachs & Andrew Warner, 1995. "Economic Reform and the Progress of Global Integration," Harvard Institute of Economic Research Working Papers 1733, Harvard - Institute of Economic Research.
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  26. Hans Jarle Kind, 2004. "Consequences of Imitation by Poor Countries on International Wage Inequalities and Global Growth," Review of Development Economics, Blackwell Publishing, vol. 8(1), pages 47-67, 02. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Testsugen Haruyama & Ken-ichi Hashimoto, 2007. "Technological Leaders and Followers in a World Economy," DEGIT Conference Papers c012_010, DEGIT, Dynamics, Economic Growth, and International Trade. [Downloadable!]
  2. Segerstrom, Paul, 2003. "Naomi Klein and the Anti-Globalization Movement," CEPR Discussion Papers 4141, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  3. Gilles Koléda, 2005. "Northern and Southern Patent Novelty Requirements Harmonization, Growth and Trade," DEGIT Conference Papers c010_025, DEGIT, Dynamics, Economic Growth, and International Trade. [Downloadable!]
    Other versions:
  4. Alessandra Bonfiglioli & Gino Gancia, 2007. "North-South Trade and Directed Technical Change," UFAE and IAE Working Papers 713.07, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC), revised 27 Jun 2008. [Downloadable!]
    Other versions:
  5. Wolf-Heimo Grieben, 2006. "Globalization with Labor Market Frictions and Non-Scale Growth," DEGIT Conference Papers c011_053, DEGIT, Dynamics, Economic Growth, and International Trade. [Downloadable!]
    Other versions:
  6. Ryo Horii & Tatsuro Iwaisako, 2005. "Economic Growth with Imperfect Protection of Intellectual Property Rights," Discussion Papers in Economics and Business 05-23-Rev., Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP), revised Apr 2006. [Downloadable!]
    Other versions:
  7. Wolfgang Keller & Carol H. Shiue, 2004. "Market Integration and Economic Development: A Long-run Comparison," NBER Working Papers 10300, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  8. Stryszowski, Piotr, 2006. "Intellectual property rights, globalization and growth," Discussion Paper 76, Tilburg University, Center for Economic Research. [Downloadable!]
  9. Óscar Afonso & Álvaro Aguiar, 2005. "Price-Channel Effects of North-South Trade on the Direction of Technological Knowledge and Wage Inequality," FEP Working Papers 170, Universidade do Porto, Faculdade de Economia do Porto. [Downloadable!]
  10. Hitoshi Tanaka & Tatsuro Iwaisako & Koichi Futagami, 2006. "Dynamic Analysis of Innovation and Licensing: The Effects of Intellectual Property Rights Protection," Discussion Papers in Economics and Business 06-06, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP).
  11. Gino Gancia & Fabrizio Zilibotti, 2005. "Horizontal Innovation in the Theory of Growth and Development," Economics Working Papers 831, Department of Economics and Business, Universitat Pompeu Fabra. [Downloadable!]
    Other versions:
  12. Wolf-Heimo GRIEBEN, 2004. "Globalization, Labor Market Rigidities and Multiple Equilibria," DEGIT Conference Papers c009_020, DEGIT, Dynamics, Economic Growth, and International Trade. [Downloadable!]
  13. Gilles Koléda, 2007. "A Two-countries Two-R&D-sectors Model of Growth and Trade," DEGIT Conference Papers c012_009, DEGIT, Dynamics, Economic Growth, and International Trade. [Downloadable!]
  14. Afonso, Oscar, 2008. "The impact of government intervention on wage inequality without scale effects," Economic Modelling, Elsevier, vol. 25(2), pages 351-362, March. [Downloadable!] (restricted)
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